(Original post by creak)
Those in the financial services, property speculators, a complicit state etc. It wasn’t exactly the lowest quartile who were responsible for the kinds of behaviour that caused the crash.

The crash was caused by a very small number of american sub-prime mortgage offerers, together with the complexity of packaged derrivative products of the same (for which it is difficult to ascribe blame, but I guess you could probably identify 50 or so people in the UK who helped design them without fully understanding their risk profile), and, more to the point, the politicians and regulators (lets say half a dozen people with actual power to do anything about it) who failed to spot the systemic risk and regulate against it.

I can see you were just itching for a chance to get that particular bugbear out of your system. Trouble is, I never mentioned anything about increasing corporation tax, though now you have I’ll note that it was second lowest in the G20 even before the recent budget, so if anything it could still have gone up a little.

Looking at corporation tax headline figures alone is misleading as many G20 companies offer massive tax breaks, incentives and subsidies to companies to locate there. What taxes were you referring to if not corporation tax? An even higher topmost bracket of income tax? figures?

But all of this actually misses the bigger issue- tax evasion, tax avoidance, and simple uncollected tax. Legislation needs to be brought in or changed to close the loopholes, and what laws exist need to be enforced far more rigorously than they currently are- obviously, closing the tax gap would relieve the pressure on government departments to cut so hard. And yet, the Tories are slashing the HMRC budget and firing huge numbers of (revenue generating) staff; they’re ignoring the mechanisms by which the richest companies and individuals hide huge amounts of wealth offshore; civil servants are writing off the tax bills of the largest corporations. It’s utter madness, and it shows that there are other agendas at work beyond simple ‘deficit reduction’.

The figures involved (avoidance and uncollected tax) are small compared to the defecit. The loopholes are incredibly hard to close.

The problem with unilateral action on tax havens etc is it simply drives businesses overseas (we have already seen this with Geneva attracting several UK financial services businesses in recent years).

The only thing that will work is multilateral action, which is incredibly slow and costly to implement.

But, once again, the figures are not anywhere near enough to (even come near to) close the defecit.

ONS and IFS figures which put paid to the hyperbole surrounding the size and nature of UK debt, which is what the post linking to that page was all about. It does that job very well. The situation really is not as dire as it’s constantly made out to be.

Only if you ignore PFI commitments, pension liabilities etc, which is of course making a nonsense of the figures.

That article is nonsense. It completely disregards the effect of the burden of interest payments among many, many other factors. It ignores explicit proclamations on Britain's rating by Moodys, S&P and Fitch. It ignores the clear and excessive waste in much of the public sector, and public-private sector gap in terms of employment terms.

(Original post by Nightstar-27)
You do realise in terms of GDP we are currently the 23rd highest. Countries with higher debts than ours and higher GDP (meaning they owe more money) include Germany, France and Japan (even before the earthquake). Meaning there are countries with far worse debts than ours, yet not all these countries are taking cuts as deep as we are. The US total debt is 97% of their GDP and I haven't heard anything about cuts to their public sector like ours. Plus our debt has been way worse than it is now in the past, especially after World War 2 and look we survived. People are getting too worked up over this debt. Our total debt is 76% of our GDP and if that was just our public sector net debt is £875.8 billion or 58% of National GDP (as of 27th of March 2011).

(Original post by HistoryRepeating)
The crash was caused by a very small number of american sub-prime mortgage offerers, together with the complexity of packaged derrivative products of the same (for which it is difficult to ascribe blame, but I guess you could probably identify 50 or so people in the UK who helped design them without fully understanding their risk profile), and, more to the point, the politicians and regulators (lets say half a dozen people with actual power to do anything about it) who failed to spot the systemic risk and regulate against it.

So realistically, we are talking about less than 60 people in the UK.

Too narrow, it’s got to be put in wider context than that. There was a systemic problem in the UK as well as elsewhere in the West, with a boom in property speculation and freer, cheaper consumer credit encouraged to perpetuate growth levels and maintain expected living standards as real term wages continued to drop. Financiers bought bad debt from home and abroad, selling and reselling it with AAA ratings endorsed by compliant credit agencies, barely investigated by a toothless FSA. The government naively believed in the ‘end of boom and bust’ and put too much faith in an economy built on cheap, unlimited credit underwritten mainly by overinflated property prices, while the opposition failed to scrutinise properly and civil servants failed to caution. There was a breakdown at all the highest levels, and now the rest of the public is being made to bear the burden of the fallout while the richest don’t feel a thing. To be honest the few words you quoted were a minor part of the overall point though- the fact that it’s the weakest in society who will hurt the most doesn’t concern you?

(Original post by HistoryRepeating)
Looking at corporation tax headline figures alone is misleading as many G20 companies offer massive tax breaks, incentives and subsidies to companies to locate there. What taxes were you referring to if not corporation tax? An even higher topmost bracket of income tax? figures?

The UK and London in particular has plenty of advantages too, as you know.

(Original post by HistoryRepeating)
The figures involved (avoidance and uncollected tax) are small compared to the defecit. The loopholes are incredibly hard to close.

The problem with unilateral action on tax havens etc is it simply drives businesses overseas (we have already seen this with Geneva attracting several UK financial services businesses in recent years).

The only thing that will work is multilateral action, which is incredibly slow and costly to implement.

But, once again, the figures are not anywhere near enough to (even come near to) close the defecit.

For a start the figures aren’t small- even the government estimate the tax gap to be approximately £40bn and others have come to figures of over £100bn. Besides, no one thinks that closing the tax gap will in itself reduce the deficit. It’s got to be part of a wider strategy that incorporates growth and yes, some targeted cuts as well. But the more recovered in taxes, the more that can be invested in the economy, and the less that has to be cut from public services.

I doubt the loopholes are as hard to isolate and amend as you make out, either- might help if HMRC weren’t losing thousands of skilled staff though, eh? It’s a question of will, and the government don’t have it (well, aren't interested in it). Companies won’t relocate because they have to pay their fair share of corporation tax on UK earnings. Either they can enjoy the profits of one of the largest markets in the world and pay up, or for the sake of a few pence in the pound they can miss out on it altogether. They can base themselves here and enjoy all the benefits of the UK’s infrastructure, due process, good governance, lifestyle and convenience, or they can fly the board out to some tax haven each week to save the same in tax as they spend on travel. Individuals could be taxed by citizenship as in the US- pay your fair share or renounce your citizenship and lose the benefits that a British passport grants you. The flight out of the country isn’t and wouldn’t be as exaggerated as you make out.

(Original post by HistoryRepeating)
Only if you ignore PFI commitments, pension liabilities etc, which is of course making a nonsense of the figures.

Spending commitments are never included in these figures though. It’s not debt, it hasn’t been borrowed. If you have to count it, put it into context by adding commitments, indemnities, liabilities and all the rest of it for the preceding century as well, do the same for all comparable countries, and then compare. The result will still be the same; the national debt really isn’t that bad.

(Original post by kopite493)
yes where in debt so you create jobs which you can tax not take them away with cuts

Just think about this for a second. Governments can only create jobs in the public sector (directly). This is funded via tax. No-one pays more in tax than they earn. How will MORE public-sector workers RAISE tax?

(Original post by HistoryRepeating)
That article is nonsense. It completely disregards the effect of the burden of interest payments among many, many other factors. It ignores explicit proclamations on Britain's rating by Moodys, S&P and Fitch. It ignores the clear and excessive waste in much of the public sector, and public-private sector gap in terms of employment terms.

(Original post by LawBore)
Just think about this for a second. Governments can only create jobs in the public sector (directly). This is funded via tax. No-one pays more in tax than they earn. How will MORE public-sector workers RAISE tax?

its not about the tax they pay on their wages but the tax they pay on items they can then pay for because they are spending because they have money to spend.

where- as if they don't have a job they are just taking tax as benefits only has enough money to live on not some luxuries which can be taxed

(Original post by kopite493)
its not about the tax they pay on their wages but the tax they pay on items they can then pay for because they are spending because they have money to spend.

where- as if they don't have a job they are just taking tax as benefits only has enough money to live on not some luxuries which can be taxed

Right, I don't understand what you are saying at all. Yes, they'll spend money on stuff. But it is money that they would only have because everyone paid for it in tax. Your argument is basically like saying that doubling everyone's benefits would make us richer because we'd 'have more money to spend'.

(Original post by LawBore)
Right, I don't understand what you are saying at all. Yes, they'll spend money on stuff. But it is money that they would only have because everyone paid for it in tax. Your argument is basically like saying that doubling everyone's benefits would make us richer because we'd 'have more money to spend'.

ill be honest im not good at explaining the in and outs of how the taxing works

People blame our debt on the banks. This is wrong. It cost us 80 Billion to bail out the banks and in a few years we will get all the money back and possibly have a profit.

I would say that from doing a bit of research the deficit is much higher now because of the banking bailout which will make thing a lot harder to balance the books so it is still a lot of the faults of the banks that this country is in the financial mess.